INDEX
Accenture, 133
accounting, 116
external data sources and, 97–98
move to big data from, 99–101
traditional approaches to, 41–42, 97, 194
Adidas, 109
affinity
customer contributors and, 68, 70, 71
networks and, 4, 22, 98, 150, 153, 160, 161
subscription model and, 77, 80, 81, 83
Airbnb, 3, 4, 8, 31, 44, 58, 61, 66, 81, 91, 139, 156, 159, 160, 174, 179
Alphabet, 118
Amazon.com, 3, 47, 57, 60, 110, 119, 143, 147, 177–178, 183, 190
American Airlines, 133
American Management Association, 57
Amgen, 133
Ammann, Daniel, 113
analytics
digital technology for, 30, 31, 32, 34
GE’s Immelt on importance of, 199–200
as key technology, 32
leaders’ access to information and, 57–58
leaders’ openness to using, 115, 116
network orchestrators and, 148
shift from basic accounting to big data and, 99, 102
social media data and, 143
technology creators producing, 14, 133
Andreessen Horowitz, 101
Apple, 43, 50, 53, 62, 98, 110, 130, 161, 171
Apple Developer Program, 159, 190
asset builders
evaluating organization’s performance as, 135–136
examples of, 15
identifying organization’s characteristics related to, 133–135
industry sector adoption comparison for, 22–23
market valuation comparison for, 18–19
number of companies analyzed for, 13
overview description of, 14
performance comparison for, 16
physical capital used by, 15
PIVOT assessment of business models with, 132–133
scalability characteristics of, 16, 17
value creation comparison for, 19–20
Best Buy example of use of, 45–46
categories of, 41–42
importance of shifting, 46
inventory of, 144–145
management practices for, 42–44
market valuation of tangible versus intangible, 40, 46
measurement approaches required by new kinds of, 96–97
mental model evolution on, 193–194
move from tangible to intangible in, 44–45, 139
physical assets as financial liabilities in, 43–44
assets (continued)
questions to ask about, 44–45
scoring your company on, 121–122
AstraZeneca, 73
Bain & Company, 65
Barna, Hayley, 76
Beauchamp, Katia, 75
Beck, Megan, 7
Bergdorf Goodman, 76
Bergemann, Rosalind, 90
big data
analytics using (see analytics)
Dickey’s Barbecue Pit example of use of, 95–96
examples of use of, 101–102
goals for using, 99–100
intangible assets as sources of, 100
as key technology, 32
move from accounting to, 99–101, 102
real-time use of, 98–99
talent for collecting, 100
Blockbuster, 46, 54, 82–83, 197
business model assessment and, 131
diversity on, 105, 106–107, 109–110
goals and, 109
Kellogg’s purchase of Kashi example of problems with, 103–104
Macy’s example of success of, 109–110
mismatch between employees, customers, and networks and, 104–107
move from governance to representation by, 107–109
network orchestrators and, 106–107
networks as starting point for, 110–111
scoring your company on, 121–122
technology gap on, 106, 107, 108
trends in composition and practices of, 105
Brand Finance, 68
brands
Kellogg’s purchase of Kashi example of problems with, 103–104
subscription model using, 79
Brin, Sergey, 118
Brotman, Adam, 191
Bryant, John, 104
budgets, and capital allocation, 53
Budwey, Frank, 93
Business Insider, 129
business models
action and mental model evolution and, 193–193
assessing, on OpenMatters website, 10, 121, 133
boards and, 106–107
capital allocation by type of, 15
capital allocation strategy and, 49, 51, 52, 53–54
company examples by type of, 14
digital technology in, 30–31
dimensions affected by, 20–21
financial services and, 129–130
GE’s Immelt on transforming, 199–200
identifying organization’s characteristics related to, 133–135
implications of choosing, 20
industry sector adoption comparison for, 22–23
market valuations by type of, 17–19
matching organization’s performance to, 135–136
number of companies analyzed by type of, 13
OpenMatters’ research articles on and tools for, 131
open mindsets and changes to, 113, 114, 116, 120
overview of types of, 14 (see also asset builders; network orchestrators; service providers; technology creators)
performance by type of, 16
Pinpointing in PIVOT process, 131–133
possible situations behind slow changes of, 23–24
research on digital networks related to, 12–14
scalability by type of, 15–17, 132
value creation by type of, 19–20
workforce changes and, 91
Caesars, 98–99
capital allocation
best practices for, 52–53
budget approaches and, 53
by business model type, 15
goals for, 52
leaders and, 53
move from operator to allocator in, 51–52
selling or closing projects and, 53–54
strategy decisions related to, 49–51
car-sharing services, 113, 155
CEO.com, 199
Chambers, John, 37
change
network leaders and rapid pace of, 190–191
openness to. See openness
reinforcing mental models to realize, 197–199
change leader, in PIVOT process, 132
Charles Schwab, 130
Christiansen, Ole Kirk, 67
Cisco, 37
closed organizations, move to open organization from, 115–118, 120
cloud technology
examples of companies using, 47, 140, 152, 176, 190
as key technology, 32
network orchestrators and, 148
platform choice and, 162
co-creators, leaders as, 56, 59–61, 71
Comcast, 43
commanders, leaders as, 56, 58, 59–60, 63, 71
Conference Board, 107
Consumer Reports, 80
contractors
advantages of using, 86–89, 171
inventory of, 147–148
contributors
description of, 66
Lego Group example of, 67
move from customers to, 71–72
size of company and, 72–73
subscription model and, 77, 80
value of contribution by, 68–70
core beliefs
innovation and, 196–197
inverting, 195–196
mental model of network leaders with, 192
Cracking the Value Code (Libert, Samek, and Boulton), 6
Cratejoy, 70
Credit Suisse, 106
amount of information available to, 57–58
data acquired from, 78, 81–82, 96, 97, 98–99, 100, 102
digital technology enabling new interactions with, 31, 70
Lego Group example of interactions with, 67–68
loyalty of, 41, 65–66, 71, 76, 80, 81, 97–98, 100, 110, 194
management practices for intangible assets related to, 42–43
mismatch between boards and, 104–106
move to contributors by, 71–72
open organizations and, 116, 118
options available to, 57
participation valued by, 58
ratings provided by, 81, 160, 178
scoring your company on, 121–122
size of company and, 72–73
as subscribers (see subscription model)
customers (continued)
Threadless online community example of, 68–70
value of contribution by, 68–70
data collection
customer ratings for, 81, 160, 178
external sources in, 97–98
goals of, 99–100
new kinds of assets requiring new approaches to, 96–97
subscription model and, 78, 81–82
timeliness of data in, 98–99
Davidson, Adam, 86
decision making
big data use and, 100
co-creators and, 61
network management and, 173
Deere & Company, 101
DeHart, Jacob, 68
Dickey, Roland, 95
Dickey’s Barbecue Pit, 95–96
Digital IQ Index, 110
digital networks
co-creator and user-led aspects of, 21–22
executives’ attitudes toward, 23–24
intangible needs met by, 21
law of increasing returns and, 12
scaling cost for, 12
digital platforms, 33–34
choosing, in PIVOT process, 162–163
description of, 33
importance of, 33–34
investment needed for, 172
managing in-house, 172–174
market valuation advantages of, 19
move from physical to digital in, 34–37
network orchestrators using, 33, 36–37
open organizations and, 118
Operating, in PIVOT process, 170–172
partnership approach to, 171
scalability characteristics of, 16
talent needed for, 170–172
team roles identified for, 171
technology choices for, 171
Visualizing, in PIVOT process, 162–163, 170
digital technology
boards’ gap in knowledge and use of, 106, 107, 108, 110
broad application and use of, 30
business models and, 22–23, 31
communication changes and, 57
examples of strategy for moving toward, 47, 49–50
intangible assets leveraged using, 41, 42, 44, 45
mentorships for, 199
need for talent with experience in, 35
network advantages using, 12
new forms of customer interactions using, 31, 70
platform growth and, 34
understanding five key technologies in, 32–33
digital tools, on OpenMatters website, 10
discussion forums, 70, 72, 162
disruption, executives’ attitudes toward, 23, 24
diversity, and board membership, 106, 108, 109–110
Dorsey, Jack, 59
Dunn, Brian, 45–46
eBay, 12, 14, 73, 91, 133, 179
economics of scale, 17
Edison, Thomas, 173
Elaguizy, Amir, 77
Eli Lilly and Company, 73
contractor model and, 86–89, 147–148, 171
feedback to leaders from, 92
Hollywood model (short-term, project-based work) and, 86, 87
management practices for intangible assets related to, 43
mismatch between boards and, 104–106
move to partners from, 89, 90–92, 93
multiple roles of, 93
new model for employment of, 86–87
questions to ask about, 92
scoring your company on, 121–122
sharing-economy companies and, 85
Encyclopedia Britannica, 8, 46
Enterprise Community Partners, Inc., 184
Inventory step and, 152–153
Operating platforms and network step and, 175–176
overview of, 127–128
Pinpointing business model and mental model step and, 140–141
questions asked by, 128
Tracking step and, 183–184
Visualizing step and, 163–165
Ernst & Young, 85
Everything Store, The: Jeff Bezos and the Age of Amazon (Stone), 119
Facebook, 6, 12, 15, 21, 22, 32, 33, 36, 42
Fenwick, Nigel, 5–6
Fidor, 130
financial services, 129–130
Ford Motor Company, 133
Gallup, 90
General Electric (GE), 199–200
generally accepted accounting principles (GAAP), 97
General Mills Worldwide Innovation Network (G-WIN), 73
General Motors (GM), 113–114, 197
Gerstner, Lou, 47
GlossyBox, 76
goals
for big data collection, 99–100
for boards, 109
for capital allocation, 53
Google, 3, 43, 91, 101, 110, 114, 118, 119, 148, 167–168, 183, 190
Google Glass, 167
Google Labs, 190
Google+, 33
Google Ventures, 101
Granular, 101
growth of networks, and law of increasing returns, 12, 17
guiding principles, of network leaders, 192–193
Guru, 87
Gutierrez, Carlos, 103
Hastings, Reed, 196–197
Hazelbaker, Jill, 168
Hertz, 4
Hicks, Angie, 197
Hollywood model of employment, 86, 87
Homeaway, 156
human capital
business model based on, 15, 132
inventory of, 126, 145, 146, 147–148, 163
mental model values on, 138
network platforms and, 159
network team talent and, 171
ideas. See intellectual capital
IMD, 24
Immelt, Jeff, 199–200
industry sectors, business model adoption comparison by, 22–23
information. See also big data; data collection; intellectual capital
subscription model using, 80
innovation
new core beliefs needed for, 196–197
in open organizations, 116, 118
Instagram, 21, 42, 60, 78, 79, 143
intangible assets
big data collection from, 100
categories of, 41–42
digital technology for producing, 42, 45
importance of shifting to, 46
inventory of, 144–145
management practices for, 42–44
market valuation of tangible versus, 40, 46
move from tangible assets to, 44–45
questions to ask about, 44–45
intellectual capital
business model based on, 15, 132
digital networks and, 12
as intangible asset, 41–42
inventory of, 126, 144, 145, 146, 148–149, 163
market valuation related to, 40
mental model values on, 138
network orchestrators’ use of, 15
network platforms and, 159
internet of things, 30, 32, 101, 148, 162
Inventory step in PIVOT, 126, 144–153
asset types included in, 145, 146
Enterprise Community Partners example for, 152–153
goal of, 144–145
of human capital assets, 147–148
of intellectual capital assets, 148–149
of network capital assets, 149–151
of physical capital assets, 147
possible gaps during process of, 151
task force team needed for, 145–147
iPads, 30
iSentium, 98
JPMorgan Chase, 133
Jobs, Steve, 62
John Deere & Company, 101
Joint Special Operations Task Force, 55–56
law of increasing returns, 12
leaders and leadership, 27, 55–63
accessibility of, 60
assessing business model with, 131
big data use and, 100
capital allocation strategy and, 49, 50, 51, 53
change leader in PIVOT process and, 132
decision making and, 61
employee loyalty and, 57
individual personality characteristics and, 61–62
Joint Special Operations Task Force example of, 55–56
Kellogg’s purchase of Kashi and, 103–104
mismatch between employees, customers, and networks and, 104–105
move from commander to co-creator in, 56, 59–61, 71
network orchestrator business model and, 23–24
new environment requiring changes in, 58–59
open organizations and, 114, 115, 116
Pinpointing mental models of, in PIVOT process, 137–139
relationship changes affecting, 56–58
scoring your company on, 121–122
shared vision and, 61
skills evaluation of, 138
value creation and, 62–63
values evaluation of, 138
legacy firms
best practices of, compared with network companies, 20
business model adoption by, 23
importance of moving to digital technology by, 34–35
Lending Club, 130
Levinson, Sara, 109
Li & Fung, 110
LinkedIn, 8, 10, 15, 21, 44, 79, 80, 87, 91, 97, 107, 160, 171, 174, 199
loyalty
of customers, 41, 65–66, 71, 76, 97–98, 194
of networks, 10, 158, 174, 180
loyalty programs, 80, 81, 96, 97–98, 100, 110, 174
L2 Digital IQ Index, 110
Ludwig, Terri, 128, 140, 141, 163, 164, 183, 184
Lundgren, Terry, 110
management practices
big data analysis and use and, 100–101
for intangible assets, 42–44
management team
business model assessment and, 131
See also leaders and leadership
Mankiw, Gregory, 49
market valuation
business model comparison for, 18–19
capital allocation strategy and, 53–54
of tangible versus intangible assets, 40, 46
mass career customization, 91
McChrystal, Stanley, 55–56, 58
McKinsey & Company, 50, 51, 52, 106, 199
McRaney, David, 191–192
Dickey’s Barbecue Pit example of use of, 95–96
external data in, 97–98
goals of, 99–100
move from accounting to big data in, 99–101
new kinds of assets requiring new approaches to, 96–97
scoring your company on, 121–122
timeliness of data in, 98–99
mental models. See also mindset
action by network leaders and evolution of, 192–194
as barriers in strategy shifts, 50
breaking habits and, 198
mentoring for, 198–199
move to intangible assets and, 46
of network orchestrators, 194–195
new stories needed for, 198
Pinpointing in PIVOT process, 137–139
reinforcing, to realize change, 197–199
millennials, 8, 89, 90, 130, 155, 199
diversification of new ideas and methods in, 115
examples of companies using, 118–119
General Motors’ example of change in, 113–114
move from closed to open in, 115–118, 120, 186
network orchestrators and, 114–115, 118, 202
openness to change and, 114–115
organizational culture supporting, 117–118
questions to ask about, 117
scoring your company on, 121–122
minorities, and board membership, 105, 108
mission, 67, 92, 103–104, 118, 119, 140, 163
mission statement, 117
mobile technology
customers’ use of, 156
examples of companies using, 36, 53, 70, 110, 191, 197
as key technology, 32
network orchestrators and, 148
platform choice and, 162
multiplier (price/revenue)
market valuation comparison among business models using, 18–19
performance comparison among business models using, 16
use of term, 17–18
Myatt, Mike, 90
NASA, 73
Net Promoter Score (NPS), 65, 83
network capital
business model based on, 15, 132
inventory of, 126, 145, 146, 149–151
mental model values on, 138
network orchestrators’ use of, 16
network platforms and, 160
Network Challenge, The (Kleindorfer, Wind, and Gunther), 7
network leader on teams, 169–170, 178, 179
network leaders in organizations, 189–203
core beliefs of, 192
digital technology changes and, 190
guiding principles of, 192–193
mental model evolution of, 192–194
network orchestrators as, 202
new thinking needed by, 189
responses to rapid pace of change by, 190–191
network orchestrators
boards and, 106–107
digital platforms used by, 33, 36–37
economic advantages of, 15–16
evaluating organization’s performance as, 135–136
examples of, 14
financial services and, 130
identifying organization’s characteristics related to, 133–135
industry sector adoption comparison for, 22–23
leadership and, 56, 58–59, 60, 61, 62–63
market valuation comparison for, 17–19
measurement used by, 97
mindset openness and, 114–115, 118, 202
network capital used by, 15
as network leaders, 202
number of companies analyzed for, 13
number of companies using, 22
overview description of, 14
performance comparison for, 16
PIVOT assessment of business models with, 132–133
possible situations behind slow adoption of, 23
scalability characteristics of, 15–17
tracking network and platform metrics for, 178–179
value creation comparison for, 19–20
Visualizing business model for, in PIVOT process, 157–158
networks
best practices of legacy firms compared with companies using, 20
customer groups within, 149–150
intangible needs met by, 21
law of increasing returns and, 12
open organizations’ use of, 116
subscription model using, 80
network sentiment, 44, 97, 98, 100, 150, 179, 180
Nickell, Jake, 68
Nike, 53, 70, 82, 160, 161, 171
Nordstrom, 76
Ocean Tomo, 97
Oculus VR, 36
OpenMatters, business models research of, 131
OpenMatters website
additional resources and support on, 128, 131, 203
business model resources on, 121
mental model assessment on, 138
survey of organization’s characteristics on, 135
openness
examples of companies with, 118–119
open organizations
diverse initiatives and business units in, 116–117
examples of, 118–119
innovation pipeline in, 116
move from closed organization to, 115–118, 120, 186
organizational culture supporting, 117–118
questions to ask about, 117
talent in, 117
Operate step in PIVOT, 126, 127, 169–176, 186
creating platform in, 170–172
Enterprise Community Partners example for, 175–176
goal of, 169
management plan for, 174–175
management practices in, 172–174
selecting network leader and team in, 169–170, 173
organizational culture, and openness, 117–118
Palmisano, Sam, 50
partners
customer contributors as, 34, 58, 59
independent workers as, 89, 90–92, 93
performance
business model comparison for, 18–19
Pinpointing in PIVOT process, 135–136
Phone Case of the Month, 81
physical capital
business model based on, 15, 132
inventory of, 126, 145, 146, 163
mental model values on, 138
network platforms and, 159
Pinpoint step in PIVOT, 126, 130–141, 185
assessing current business model in, 131–132
defining current business model in, 132–133
defining mental model in, 137–139
Enterprise Community Partners example for, 140–141
goal of, 130–131
identifying organization’s characteristics in, 133–135
reviewing economic performance in, 135–136
Pinterest, 44
PIVOT, 123–186
additional resources and support for, on OpenMatters website, 128, 131
change leader in, 132
Enterprise Community Partners example for, 127
five steps of, 126–127
introduction to, 125–128
Pixar, 68
plans
for big data use, 99–100
for filling technology, talent, and capital gaps in platforms, 171–172
for growth, on OpenMatters website, 10
for network management, 174–175
for reallocating capital, 157–158
PricewaterhouseCoopers, 106
principles for network orchestration, 25–122
as challenges and levers for change, 27
list of, 27–28
scoring your company on, 121–122
Principles of Economics (Mankiw), 49
Project Loon, 167
Red Hat, 133
Reichheld, Fred, 65
relationships with customers
data collection in, 81–82
as intangible asset, 42
leaders affected by changes in, 56–58
personalized approach to, 82
in subscription model (see subscription model)
advantages of subscription models for, 77–78
move from transaction to subscription in, 78, 79–82
Netflix versus Blockbuster example in, 82–83
nonrevenue activities in subscription model and, 78–79
recurring, in subscription model, 75–77
scoring your company on, 121–122
reverse mentoring, 108, 162, 199
ride-sharing services, 44, 85, 113, 155, 197
Rouse, Jim, 127, 128, 165, 184
Rouse, Patty, 127
Russell Reynolds, 107
Salesforce.com, 176
scalability
advantages of, 31
business model comparison for, 15–17, 132
cloud technology and, 32
costs with, 12, 16, 17, 19, 33, 63, 139
digital technology enabling, 3, 33, 41, 44, 162
economics of scale contrasted with, 17
global access and, 31
of network lodging options, 156
network orchestrators and, 172, 202
Threadless example of, 69
scale economics, 17
service providers
evaluating organization’s performance as, 135–136
examples of, 14
human capital used by, 15
identifying organization’s characteristics related to, 133–135
industry sector adoption comparison for, 22
market valuation comparison for, 18–19
number of companies analyzed for, 13
overview description of, 14
performance comparison for, 16
PIVOT assessment of business models with, 132–133
scalability characteristics of, 16, 17
value creation comparison for, 19–20
services
as intangible asset, 41
subscription model using, 80
shared vision, and co-creators, 61
sharing-economy companies, 44, 85, 113, 155, 197
show-rooming, 45
Sidecar, 44
Sitaram, Pradip, 140, 152, 164, 175–176, 183, 184
skills assessment, 138
social media, 29
boards’ use of, 107
CEOs’ use of, 199
customer data from, 97, 98, 101
examples of companies using, 53–54, 143, 180
interactions with companies using, 58, 80, 107, 202
as key technology, 32
leveraging for marketing and communication, 34
network sentiment tracked on, 180
public relations problems from customers’ use of, 42–43
subscription model using, 77–78, 80
Softlayer, 48
software subscription model, 76, 80
Spencer Stuart, 105
Sprint, 81
Stanford University, 107
Starbucks, 53, 109, 143, 190, 191
barriers to changing, 48–49, 50
best practices of allocators in, 52–53
capital allocation as focus of, 49–51
IBM as example of shift in, 47–48, 50
move from operator to allocator in, 51–52
Nike-Apple partnership as example of, 53–54
questions to ask about, 52
scoring your company on, 121–122
subscription model
advantages of, 77–78
customer contributors and, 77
examples of companies using, 75–76
moving customers from transactors to subscribers in, 78, 79–80
Netflix versus Blockbuster example in, 82–83
nonrevenue activities in, 78–79
personalized approach in, 82
recurring revenue from, 76–77
surprising and delighting the customer in, 81
themes in implementing, 80–82
types of offerings in, 80
talent
big data collection and, 100
customer contribution of, 69
for digital platform operation, 170–171
experience in digital technologies needed by, 35
innovation and, 168
in open organizations, 117
tangible assets
as financial liabilities in, 43–44
market valuation of intangible versus, 40, 46
move to intangible assets from, 44–45
Target, 76
Team of Teams: New Rules of Engagement for a Complex World (McChrystal), 55
advantages of using, 31
business models incorporating, 30–31
embracing “digital everything” in, 30–31
essential aspect of, 29–30
importance of understanding and using, 30
management practices for intangible assets related to, 42
mentorships for, 199
move from physical to digital in, 34–37
platforms and, 33–34
questions to ask about, 35
scoring your company on, 121–122
talent needed for, 35
understanding five key technologies in, 32–33
technology creators
evaluating organization’s performance as, 135–136
examples of, 14
identifying organization’s characteristics related to, 133–135
industry sector adoption comparison for, 22
intellectual capital used by, 15
market valuation comparison for, 18–19
number of companies analyzed for, 13
overview description of, 14
technology creators (continued)
performance comparison for, 16
PIVOT assessment of business models with, 132–133
scalability characteristics of, 16, 17
value creation comparison for, 19–20
Tesla, 114
Threadless, 68–70, 72, 73, 78, 79, 81
Thrun, Sebastian, 168
Topsy, 98
Track step in PIVOT, 126, 127, 177–184, 186
Amazon example of, 177–178
Enterprise Community Partners example for, 183–184
goal for, 178
network and platform metrics for, 178–179
network dimensions used in, 179–180
ongoing experimentation with, 182–183
platform dimensions used in, 180–181
team dimensions used in, 181–182
Trader Joe’s, 78
transactors, customers as, 78, 79–80
TripAdvisor, 10, 14, 44, 159, 174
Trunk Club, 76
Twitter, 42, 59, 60, 66, 72, 78, 79, 89, 97, 100, 107, 148, 171, 180, 199
Uber, 3, 4, 44, 66, 70, 81, 85, 91, 114, 155, 159, 160, 174, 197
United Healthcare, 133
US Board Index, 105
US interstate highway system, 11–12
value creation
business model comparison for, 19–20
mental model beliefs on, 138–139
nonemployees and, 91
values assessment, 138
van Kralingen, Bridget, 47, 48
Verizon, 81
virtual reality (VR) technology, 36
Visa, 133
vision, and co-creators, 61
Visualize step in PIVOT, 126, 127, 156–165, 186
analyzing possible contribution to networks in, 160–161
beginning step for, 157–158
choosing platform in, 162–163, 170
Enterprise Community Partners example for, 163–165
goal of, 156–157
identifying potential networks in, 159–160
network orchestrator business model in, 157–158
overview of process in, 158–159
selecting network for, 161–162
team in, 158
VRBO, 156
Walmart, 4, 14, 76, 110, 133, 144
Wealthfront, 130
Weatherup, Craig, 110
WeChat, 4
Werhane, Charlie, 140, 164, 184
women, and board membership, 105, 108, 109
workforce. See employees